Sunday May 19, 2024

Sugar price indicates declining trend

By Our Correspondent
January 21, 2024

LAHORE: The wholesale price of sugar has shown declining trend amid reports of better-than-expected production.

Labor can be seen placing sugar bags in quantity. — AFP/File
Labor can be seen placing sugar bags in quantity. — AFP/File

According to dealers, the wholesale price of 100 kg sugar bag was reduced by Rs 300 from Rs 13,700 to Rs 13,400. With decrease of Rs 3/kg, its price now stands at Rs 134 per kg and 59kg bag is being sold at Rs 6,700. However, in retail market sugar is still costlier for consumers as it is being sold at in excess of Rs 145 per kg. Consumers complained that the commodity is also not available at many retail outlets. Market insiders claimed that there are reports of better sugarcane per acre yield this year despite lower area under cultivation.

Moreover, they said the sugar recovery is also said to be on higher side, leading to declining trend in sweetener price. Traders said the government has also rejected sugar millers demand of exporting sugar which also helped in lowering price of sugar. It may be noted that country’s sugar production rose by five percent in the first two months of the 2023-24 crushing season, despite a late start and lower estimates of sugarcane area.

The country produced 2.252 million tonnes of sugar in the ongoing crushing season till December 2023, compared with 2.143 million tonnes in the same period a year earlier, showing 0.108 million tonnes or five percent more manufacturing of sweetener this year, according to the industry data. Sindh recorded a 49 percent increase in sugar output, while Punjab and Khyber Pakhtunkhwa saw marginal declines. Sugar mills in Punjab produced 1.384 million tonnes of sugar until December 2023, compared to 1.397 million tonnes manufactured during the same period last year. Sindh registered a major jump in sugar production this year with the manufacturing of 0.725 million tonnes until December 2023, compared to last year’s production of 0.485 million tonnes by the end of the corresponding month last year.

Compared to production of 0.142 million tonnes by Khyber Pakhtunkhaw this year, as many as 0.145 million tonnes of sugar were produced by December 2022. In spite of sugar industry’s reluctance in commencing the crushing season this year, 0.215 million tonnes of sugar were produced in the country in November 2023, compared to previous year’s corresponding month output of 0.115 million tonnes. As per insiders, the high price of sugar and relatively lower estimates of sugarcane production prompted sugar manufacturers to start the crushing season robustly in the ongoing season. The assessment of lower sugarcane production in the country in Kharif 2023 was primarily based on the lower area under cultivation in the Punjab province by about 15 percent. However, market insiders believed that the country-wide sugar manufacturing was set to cross six million tonnes this year, reaching close to last year’s total yield of 6.6 million tonnes. They particularly emphasised the strictest possible curbs on the smuggling of the commodity to Afghanistan and Iran through land routes.

They were of the view that the interim government’s ban on the export of sugar was a step in the right direction and it should be continued in letter and spirit with a view to effectively meeting domestic demand.